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JUDY WOODRUFF'S INSIDE POLITICS

D-Day For Davis?

Aired July 23, 2003 - 16:00   ET

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.

(BEGIN VIDEOTAPE)
ANNOUNCER: History in the making in the Golden State. Will Californians boot their governor from office?

He's fighting for his political life, but if he goes down, he'll go down swinging.

GOV. GRAY DAVIS (D), CALIFORNIA: The recall movement is sponsored by a bunch of losers.

ANNOUNCER: Can Gray Davis survive? We'll speak with the governor.

So what happens next and who's waiting in the wings? Will the Terminator come to the rescue?

Now, live from Sacramento, California, a special edition of JUDY WOODRUFF'S INSIDE POLITICS.

(END VIDEOTAPE)

JUDY WOODRUFF, CNN HOST: Thank you for joining us.

Well, what was once considered unthinkable is highly probable here in California. A statewide recall election to determine the fate of Governor Gray Davis, just eight months after he won a second term in office.

As recall supporters march on the capital, county election officials face a 5:00 p.m. local deadline to submit their latest tallies of verified recall petitions. Officially, 678,000 voter signatures have been turned in, but news media surveys of county offices found more than enough petitions have been submitted to force a referendum. So barring legal challenges or unexpected developments, the petitions are expected to be certified. An election date will be set and an election could happen as soon as late September.

The move to recall the governor has left California in a state of political upheaval.

(BEGIN VIDEOTAPE)

WOODRUFF (voice-over): How did we get from this:

(SINGING) WOODRUFF: To this.

UNIDENTIFIED MALE: Somebody save us from Gray Davis.

WOODRUFF: Hollywood couldn't have scripted it any better. A governor estranged from the governed, a fired up group of rebels with a cause, and an action hero poised to swoop in and save the day. It sounds like a silver screen classic, but it's actually a lesson in the arcane and unpredictable nature of Golden State politics.

DAVIS: I will always be grateful to you. God bless you.

WOODRUFF: Californians gave Gray Davis a second term last year, but grudgingly. The Republican challenger was weak and the incumbents campaign ferocious. Despite his victories, the governor never really clicked with many constituents.

UNIDENTIFIED MALE: He was the best worst choice.

WOODRUFF: Davis presides over a rolling electricity crisis and a staggering $38 billion budget deficit.

These days, barely 20 percent of California voters say he's doing a good job and last spring a motivated group of activists set out to take him down.

TED COSTA, RECALL ORGANIZER: This thing is going to pass. There's going to be a new governor. The new governor will then have time to put together his plan or her plan to do something about this financial mess we're in.

WOODRUFF: Recall movements are nothing new in California. There have been 31 attempts, but none has made it on to the ballot. This year's model will likely break that pattern. Organizers need to produce signatures from nearly 900,00 registered voters. They say they've got 1.6 million.

Davis is ready to fight.

DAVIS: The recall movement is sponsored by a bunch of losers. I won that election fair and square.

WOODRUFF: And so are his supporters.

ART PULASKI, CALIF. LABOR FEDERATION: The proponents of the recall represent a very narrow extreme point of view within the Republican Party. And I know many Republicans who have even said to me, We don't agree with those people. We oppose what they're doing and we'll vote no on the recall.

WOODRUFF: If voters recall Davis, they'll have to choose a successor.

ARNOLD SCHWARZENEGGER, ACTOR: Hasta la vista, baby.

WOODRUFF: Arnold Schwarzenegger's been testing the waters, of course.

Congressman Darrell Issa, who is pumping his own millions into the recall campaign is also eying the state's top job. And former Los Angeles Mayor Richard Reardon is also in play.

No-star Democrat is publicly weighing a run, although polls show Senator Diane Feinstein would be a top contender.

Got all that? Stay tuned for a real Hollywood ending.

(END VIDEOTAPE)

WOODRUFF: A little while ago, I spoke with California's secretary of state, Kevin Shelley, and I asked him if he is confident that his office, along with county election offices, are handling the recall petition fairly.

(BEGIN VIDEO CLIP)

KEVIN SHELLEY, CALIF. SECY. OF STATE: Our guiding light is what's fair and what's appropriate and what's legal. And I think we've made the right decisions. We're given the right guidance to the counties.

But it's all new, and that's the important point. There's never been a special election in the history of the state of California. Never before has a recall of a governor in California made it on the ballot. This is the 32nd try. So these are unchartered territories and very difficult waters to move through. But I think we're doing a good job.

(END VIDEO CLIP)

WOODRUFF: Secretary of State Kevin Shelley.

Well, collecting voters signatures is just the beginning of the complicated process that is required to force a recall election.

CNN's Charles Feldman is with me now to talk about what happens after the signatures are certified -- Charles.

CHARLES FELDMAN, CNN CORRESPONDENT: Judy, right now an appeals court is deciding whether to hear arguments by Davis backers to get an order stopping California's secretary of state from declaring a special recall election.

Now, if the court doesn't act in time, here's what's next.

(BEGIN VIDEOTAPE)

FELDMAN (voice-over): Once the secretary of state certifies enough verified signatures to force a recall, the lieutenant governor says he'll pick an election date within a couple of days. That election must then be held in 60 to 80 days. That could be as early as September 30. Candidates wanting to replace the unpopular Gray Davis must declare their intentions 59 days prior to the election. Worse case scenario here, candidates could have as little as one day to make up their minds.

The big guessing game now is: what will Arnold do? Will the Terminator, as many expect, enter the race? Anyone can for $3,500 bucks. If he does, is it Gray Davis' final act? And what will the Democrats do? They claim no Democrat will run in a recall election, but that could change as reality, or something close to it, sets in.

(END VIDEOTAPE)

FELDMAN: And, Judy, let's go through that looking glass together. The latest buzz, the lieutenant governor reportedly looking into whether he can block voters from picking a replacement for Davis, and under the state constitution, take over the job himself. In a phone conversation a short time ago, the lieutenant governor told us it will be others who will decide how that will shape up. After all, he said, he's not a constitutional scholar -- Judy.

WOODRUFF: And our understanding is that the lieutenant governor will get this thing going in the next few days. All right. Charles Feldman, thanks very much.

Just a short time ago I spoke with Governor Gray Davis himself about the recall effort and I started by asking if he thinks his political career is literally on the line.

(BEGIN VIDEOTAPE)

DAVIS: I said if the recall got serious, I would get serious. And this election is not about changing governors, it's about changing direction. And I think at the end of the day the voters are going to opt for a progressive agenda, not a conservative agenda.

WOODRUFF: Governor, you say that. But let's talk about Gray Davis. I mean there are people look at you right now from all over the country and say this has to be a miserable job right now. Historically low approval ratings, the fact that you are facing a deficit of gargantuan proportions. Is this something you really want to continue doing? Why not just hang it up?

DAVIS: Well, it was a lot more fun when I started two and a half years ago and the economy was roaring along, there's no question about that. And frankly most of my colleagues, Republicans and Democrats, are dealing with difficult times in their states.

But I'm not a quitter. I'm going see this thing through. I'm going to continue to point California in the right direction. And I believe strongly at the end of the day voters are fair minded and they want to continue the policies which promote choice, protecting the environment and they want to continue the gains we've had in education with test scores up four years in a row.

So I'm not going to say, hey, this is too tough, I didn't bargain for that. Voters don't want to hear it and that's not my makeup. WOODRUFF: Governor, it's not just the people pushing this recall. It's others, the state's former chief economist, who say there's was plenty information out there for you to see last yea, last summer, during the campaign that California was facing a dire fiscal crisis, which is now materialized $38 billion deficit. And they say you did nothing about it when you had the opportunity.

DAVIS: Well that's just poppycock, Judy. The legislative analyst who is nonpartisan reported on September 2, four days before we signed the budget, that the deficit for the following year would be about $10 billion and that's what we thought it was until she came out a month and a half later saying she thought it was going to be $25 billion.

So frankly the falling stock market and the declining economy, which kicked about 2 million people out of work, caught a lot of experts by surprise. You know, hindsight is great, but my job is to make the best of it and I believe we will have a budget and we will make great progress on knocking down this deficit within the next 30 days of the outside.

WOODRUFF: The political experts who know California, Governor, are saying the only way you can have a chance of surviving this recall if it's on the ballot this fall, is if no other Democrats are on the ballot. My question to you is, do you have an iron clad commitment from Dianne Feinstein and from other Democrats who might run that they will not run?

DAVIS: You know I'm not in the business of getting iron clad commitments. Dianne Feinstein without my asking has been a tremendous supporter of mine. She faced a recall, she knows what it's like. And she it's not good for the process. And she's gone out of her way to rally troops in Congress elsewhere. Nancy Pelosi was at a rally with me with Terry McAuliffe recently.

So the Democrats understand this is hostile takeover by the right. Now the voters have the right to have another election. And I will present my credentials. I think at the end of the day they will allow the state to continue to go in the direction that I'm trying to lead it and not slam it and reverse and go backwards.

WOODRUFF: You say it's a hostile takeover but now you've got Republican Congressman Darrell Issa...

DAVIS: Well that's because he financed it. This would not happen without Darrell Issa and Darrell Issa wanted to get this in the ballot in the fall so he didn't have to give up his Congressional seat. If this election was consolidated with the presidential primary, which would save us $35 million because this election will cost the taxpayers $35 million. So Darrell Issa is going to get a free ride.

WOODRUFF: But it's not only him. Now it's looking very likely that Arnold Schwarzenegger will run. He's got name, he's got money. How do you beat him?

DAVIS: You know the Terminator may be back, he might not be back. We'll see about that.

But the bottom line is I'm going to do the job people ask me to do. I'm honored to have held this office, I'm fight through it and I've been up against tough times before. You know well that my political obituary's been written six or seven times over the last 30 years and the good voters of this state has returned me to office notwithstanding predictions to the contrary and I have faith in them.

(END VIDEOTAPE)

WOODRUFF: Governor Gray Davis, who talked to me in his office in the state capitol right behind here just a little while ago.

WOODRUFF: Giving the challenges he faces, is there a way Governor Davis can survive a recall election?

Our Bill Schneider says yes, but it will not be easy.

(BEGIN VIDEOTAPE)

WILLIAM SCHNEIDER, CNN SR. POLITICAL ANALYST (voice-over): Can Gray Davis survive?

Start with this, 23 percent of California voters approve the job Davis is doing, but 43 percent say they would vote to keep him. That means twice as many people oppose the recall than support Davis, which suggests Davis' survival strategy. This is not about me.

DAVIS: This election is not about changing governors, changing direction.

SCHNEIDER: What's required mere is a little political jujitsu. Davis must keep other credible Democrats off the ballot while still motivating Democrats, half of whom are unhappy with Davis, to come out and vote. But he's a centrist with little ideological or personal following.

PHIL MATIER, "SAN FRANCISCO CHRONICLE": His fellow Democrats just feel he's sort of an empty suit. That he hasn't fulfilled the promises he made as a Democratic candidate.

SCHNEIDER: What Davis has to say is, this election is about you, your money.

DAVIS: It will cost the state 30 million and come out the same pile of money that we would better spending on public education or health care or public safety.

SCHNEIDER: Your values.

DAVIS: I am confident the voters of this state will not opt for a right-wing agenda over a progressive agenda.

SCHNEIDER: Remember the vast right-wing conspiracy. Davis could bring in Bill Clinton to argue the same people who tried to bring me down are trying to bring Gray Davis down. Davis has been good at demonizing his opposition, in this case, it may be the only way he can survive.

There aren't a lot of people in California that wake up in the morning and say Gray Davis, what a great guy. I can't thank god enough he's there. But there are enough people in California that will turn around and say, I'll have to live with this guy because the alternative is just unbearable. And that's what they're betting on.

(END VIDEOTAPE)

SCHNEIDER: Davis' gamble is if I can keep other Democrats off the ballot, maybe I can get Democrats to come out and vote, not to save me, but to prevent what the governor just called a hostile right- wing takeover --Judy.

WOODRUFF: All right. Bill Schneider.

As we said earlier Republican Congressman Darrell Issa has helped to fund the recall drive. He joins us now. Congressman Issa, I don't know if you just heard, but Governor Davis says you're behind this recall effort. You wanted it this year so you wouldn't have to step down from your congressional seat in order to run.

REP. DARRELL ISSA (R), CALIFORNIA: The governor misses the obvious, which you pointed out, which is that anyone can run in this race. I wanted this race as soon as possible because the people of California know that Gray Davis created the deficit, Gray Davis tried to cover it, successfully covered it up in the last election. Now that they know he lied, they have been to realize he has no fix for the problem. So, if you create a problem, lie about a problem and have no fix for the problem it's time for you to go as soon as possible.

WOODRUFF: Congressman, there are those that point out even if you or someone else were elected you on day one inherit a state with six or seven constitutional officers who are Democrats, you inherit a $38 billion deficit, huge fiscal problems.

Why in the world would you want a job when you got that much stacked up against you from day one?

ISSA: Well, I think anyone who has my business background will tell you there's no better place to come in than at the bottom. California is a bright and wonderful place to live. It's a place that people want to come, they want to bring their talents. They want to bring their investments. We have simply been telling them they're not welcome. So, the ability to turn California around is unlimited and will be very, very swift. But the need to do is now.

WOODRUFF: And when the governor says this election, if it takes place is going to be about keeping abortion legal, it's going to be about gay rights and about gun control instead of just about him, what do you say?

ISSA: Well, the nearly 2 million people who signed petitions ask asking for an election and asking for the opportunity to use California's lemon law to evict Gray Davis. I suspect -- first of all I know that 30 percent of them in some area's were Democrats. Second of all, I don't think they asked the question of, are you pro-life or pro-choice, what they asked and asked very strongly, are you better off today with Gray Davis or will you be better off with just about anyone?

And they answered, we'd be better off without Gray Davis. We will look for a replacement knowing that every governor we ever had in California has been better than Gray Davis.

WOODRUFF: Congressman Darrell Issa, who is widely expected to run himself, yourself, assuming this recall takes place. Congressman Issa, thanks very much.

ISSA: You're very welcome.

WOODRUFF: Thank you again.

(INTERRUPTED BY CNN COVERAGE OF BREAKING NEWS)

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